Highlights

• SMM reports falling prices and weak procurement in China's rare earth sector.
• Varied price trends are observed across different rare earth elements.
• Export controls have significantly impacted rare earth permanent magnet orders, particularly Pr-Nd alloys.
• China's rare earth trade policies are viewed as a deliberate pressure tactic in an escalating global tech and trade confrontation.

In its April 17 weekly review, Shanghai Metals Market (SMM) reports (opens in a new tab) that prices and procurement activity across much of China’s rare earth sector have fallen, citing policy guidance and soft downstream demand as the primary drivers. While prices for lighter elements, such as Pr-Nd oxide and cerium oxide, declined due to poor magnet and component demand, heavier elements like dysprosium, terbium, and yttrium oxides remained elevated and firm, suggesting a selective scarcity where strategic value is highest. Notably, SMM acknowledges export controls have curbed orders for rare earth permanent magnets, especially for Pr-Nd alloys, but emphasizes market calm and normalization in pricing behavior.

Rare Earth Exchanges Analysis

While SMM provides useful granular price data and sourcing trends, the tone of the report obscures broader geopolitical realities. By attributing the slowdown primarily to “policy guidance” and “market psychology,” the analysis understates the deliberate weaponization of rare earth trade by Beijing, especially targeting U.S. and allied defense supply chains.  The newly elected President Donald Trump triggered this latest trade war, but China’s profoundly unfair practices with the rare earth complex have been ongoing for decades.

The report’s focus on internal market dynamics in China overlooks the ripple effects of strategic export controls recently enacted, which are already tightening global supply and prompting investment in alternative sources. SMM exhibits a subtle bias in favor of narrative stability, minimizing the global risk posed by China's dominance. The reality is this: China’s policy-driven supply manipulation is not just market behavior—it’s a pressure tactic in an escalating trade and tech war. U.S. and allied stakeholders should take note and act accordingly.